GENERAL News

24.03.2014
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Real Estate & Property Services

We operate a special consultancy unit to advise clients in property development and management.

Appavoo Investment Ltd leads a cross-functional cluster of the Group and brings together the necessary consulting and corporate services to offer real estate consultancy services of high level.

The Real Estate & Property Development Services cluster has been conceived to cater for the growing demand in real estate services mostly under the IRS and RES schemes set up by the government. The Group also participates in major real estate projects in the industry, tourism and private residences.

Mauritius offers an investor an unrivalled wealth of choice and investment opportunities in hotel, residential, office shopping and warehouse development.

Regulatory Framework – Property Law in Mauritius

The immovable property market in Mauritius is well regulated and protects property rights of investor, lenders, developers, and occupiers. The Constitution of Mauritius, which is the supreme law of the country, protects the right of land owners and the right from deprivation of property.

The Mauritian laws are a hybrid of French code civil and local statutes. The substantive contents of the law are derived from the Code Napoleon. The public law is based on English common law.

The Mauritian property law is substantially based on the civil system so that sale of property in Mauritius is carried out by means of an “acte authentique”, which must be notarised, registered, and transcribed to be binding on any third party.

By virtue of Article 3 of the Civil Code, a property owned by a non-citizen of Mauritius is governed by the laws of Mauritius.

The statutes relating to real property are:

  • Investment Promotion Act;

  • Investment Promotion Act (Real Estate Development Scheme) Regulation 2007

  • State Lands Act;

  • State Land (Alienation) Act;

  • Non-Citizens (Property Restriction) Act;

  • Pas Géométriques Act;

  • Landlord and Tenants Act;

  • Planning and Development Act;

  • Land Acquisition Act;

  • Registration Duty Act;

  • Land (Duties and Taxes) Act;



Hotel Development

The attractiveness of strategic locations endowed with natural beauty has prompted many investors to invest massively in luxury hotels. The tourism industry has shown steady growth over the last 20 years with expected tourists arrivals of 2 million by 2015. Travel and tourism is expected to grow by 10% per annum, in real terms, between 2007 and 2015.

Resort hotels are usually constructed on the beach front on state land called ‘Pas Géométrique’. Leases are generally granted for terms of 20 years with renewal options up to 60 years.

Leases rentals are fixed on a case to case basis depending on geographical situations and are indeed annually.

Residential Properties

Mauritius is already a hugely popular destination for tourist and businessmen – those seeking a regional base, the expatriate professional population employed in the country and of course the increase of tourist population which is growing at fast speed. All of those visitors require quality accommodation for purchase and letting. From a development perspective, one can invest in hotels and resort accommodation, or in villas and apartments for sale or letting to the tourists or second home market.

The residential real estate segment is geared primarily toward the following markets:

  • The development of residential units on freehold land of at least 0.42 hectare (1 arpent) but not more than 10 hectares.

  • The development of luxurious villas and commercial units on land having an average of more than 10 hectares.

  • The professional market for the letting of residential property and the management thereof.

  • Acquisition of property which fall outside the specific schemes still require special permission on a case to case basis from the Prime Minister’s Office.



Commercial Properties

Access to commercial properties including offices, shops, factories, warehouses and any building. for ‘commercial use’ has been completely liberalized, Any foreigner who operates through a ‘limited company’ must first apply for an Investor Permit from the Board of Investment (BOI) following which an application may be loaded for acquisition of any commercial property to be used for business purposes.

The Integrated Resort Scheme(IRS)

What is the Integrated Resort Scheme (IRS)?The Integrated Resort Scheme (IRS) has been introduced to attract high net-worth non-citizens and citizens who are looking for an alternative or another place of residence by allowing them to acquire luxury villas on land. Such development should be “Integrated” with the location and region in which they are implemented.
Through the IRS, international buyers can obtain the “Permanent Resident” status and become residents as soon as they acquire a property on the island.
Buyers are allowed to rent their properties during the time they are not in Mauritius.

The Luxury Villas
The IRS provides for the development of luxury villas of international standing as well as extensive and high-class leisure and recreational facilities. These may include golf course, marina, individual swimming pool, catering, nautical, and other sport facilities and health centre, but will not be limited to them nor necessarily combine them all. Day-to-day management services such as security, maintenance, gardening, solid waste disposal and household services are provided to the residents.

Who can apply to buy a villa under IRS?
Any one of the following can apply under the Scheme:

  • Non- citizen of Mauritius (including his spouse and dependants);

  • A citizen of Mauritius;

  • A company incorporated under the Companies Act 2001.

  • A company registered as a foreign company under the Companies Act 2001.

  • A société, where its deed of formation is deposited with the Registrar of Companies or,

  • A trust where the trusteeship services are provided by a qualified trustee



Cost per property
The amount of investment in the acquisition of an immovable property for residence, including land not exceeding 1.25 arpents, shall not be less than US$500,000 or its equivalent in other foreign currencies.

IRS Incentives


For Developer of IRS Projects

  • No duties and taxes is payable on a deed witnessing the transfer of land to a company holding an Investment Certificate for the development of a project under the IRS;

  • The vendor of property is subject to Land Transfer Tax at the normal rate of 5% (if sold after 5 years ownership or 10% if sold before 5 years of ownership) ;

  • Exemption of taxes from the Morcellement Act;

  • Corporate tax at the normal rate of 15 per cent on Profits;

  • Exemption from land conversion tax on the part of land to be developed for the golf course within the IRS;

  • Annual capital allowance of 10 % for expenditure incurred in the setting up of golf courses


For Buyer of IRS Villas:

  • A fixed registration duty of USD 70,000 is payable upon registration of the property. This registration duty, payable at the time of signing the contract, is included in the minimum selling price of USD 500,000;

  • A non-citizen (including spouse and dependents), approved by BOI, obtains a Permanent Residence Permit upon investing a minimum of USD 500,000 in the acquisition of a villa. This residence permit shall remain valid until such time as the non-citizen holds immovable property under the Scheme;

  • The owner of a villa is allowed to resell his property with no minimum price requirement.

  • Obtention of water and electric supply from Ministry of Public Utilities;

  • Obtention of sewerage treatment clearance from the Ministry of Environment;

  • Obtention of Development and Building Permits from relevant local authorities;

  • Any other relevant permit/license



Promoters shall submit to BOI a full status report on the implementation of the project on a six-monthly basis. BOI shall set up a unit comprising of representatives of relevant authorities to monitor the implementation of the IRS project.

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Social Contribution Under IRS


The new regulation i.e. Investment Promotion (Real Estate Development Scheme Regulation 2007) which came in force in December 2007 has requested all IRS companies to contribute to an IRS social contribution.

IRS Social Contribution

  • The amount of the IRS social contribution shall be calculated at the rate of MUR 200,000 per residential property.

  • The amount of contribution shall be managed by the IRS Company.

  • Separate account must be kept by the company in respect of projects relating to the social needs of the people of the region.

  • The IRS Company shall maintain records on the implementation of projects relating to the social needs as approved by the Board of Investments.



How to determine the social needs?
A Social Import Assessment (SIA) should be prepared and submit at time of application of IRS Certificate in order to identify the impact of the proposed IRS project on the local community and an undertaking by the promoters indicating the benefits that shall accrue to local community.

In addition, the social needs shall also be required to prepare in order to asses the social needs in terms of social amenities, community development and other facilities and their estimated costs. This must be culminated in a Social Needs Analysis (SNA).
The Social needs analyses shall be prepared out by at least two professionals composed of a sociologist or a social scientist, a planner, an architect or an economist.

Nature of Social Needs
The IRS social contribution may be in terms of:

  • Social amenities, community development and other facilities

  • Land

  • A combination of the above


At least 25% of the IRS social contribution shall be related to training of people.


The Real Estate Scheme (RES)

What is Real Estate Scheme (RES)?
The Real Estate Scheme (RES) has been introduced by the government in December 2007 for the small landowners to develop their land for the construction of residential units of good standing including commercial complexe and as well as leisure amenities. Such properties can now be offered for sale to non-citizens and as well as citizens of Mauritius.

Who can develop RES?

  • The small landowner who owns a portion of land of at least 0.42 hectare (1 arpent) but not exceed 10 hectares.

  • The small landowner should have been owner of the said land, for a period exceeding at least 5 consecutive years. An important condition in setting up an RES project is for the landowner to own shares in the promoter company for the value of his land until the project is completed.



The Residential Units
RES provides for the development of residential units of good standing on freehold land including commercial facilities, leisure amenities attached to such accommodation. Day to day Management Services must be provided to the residents such as security, maintenance, gardening, solid waste disposal and household services.


Who can acquire a residential property from RES Company?
Anyone of the following persons can apply under the scheme to acquire a residential property:

  • Non-citizen of Mauritius

  • A citizen of Mauritius

  • A company registered as a foreign company under the Companies Act 2001

  • A company incorporated under the Companies Act 2001

  • A société where its deed of formation is deposited with the Registrar of Companies

  • A trust where the trusteeship services are provided by a qualified trustee licensed by the Financial Services Commission.



Cost per property
There is no restriction on the minimum amount of investment in the acquisition of a residential property under RES.

Approval of RES
The BOI is the authority which approves RES Project.

Basis of Acquisition
One can buy property under the IRS or RES either on the basis of a plan, during the construction phase or when the construction is completed. Where the acquisition is made on the basis of a plan or during the construction phase, the contract shall be governed by the provisions of a “vente à terme” (VAT) or “vente en l’état futur d’achèvement” (VEFA), as the case may be, in accordance with the provisions of the Code Civil Mauricien.

b>Special Conditions for RES

  • When the landowner holds shares in the RES company equivalent to the value of his/her land, no registration duty and land transfer taxes are payable.

  • The RES Company should provide a bank guarantee of Rs 25,000 per residential property to the Board of Investment to ensure that construction works will start within 6 months of granting of the RES Certificate.

  • The RES company has to pay 5% on the sale value of each property sold as “land transfer tax” when the transfer of residential property is registered and transcripted in the name of the acquirer.

  • An acquirer is liable to a fixed registration duty of USD 25,000 on the value of a property acquired.

  • The proposed buyer should make an application with the BOI to acquire a residential property in the RES Company. The applicant should pay a non-refundable processing fee of Rs 10, 000.